The purpose of the Opening Balances settings page is to:
- allow the user to configure the initial financial year for the business;
- import/export employee opening balances; and
- import/export historic gross earnings for employees in the business.
To access the Opening Balances page from the payroll dashboard, go to the Payroll Settings tab then click on "Opening Balances" (listed under Business Settings).
You will be directed to the following screen:
The initial financial year for the business may be adjusted here. This is the year that the opening balances for Earnings, PAYE, KiwiSaver and Deductions will apply to. When first accessing this screen, the current financial year will display as the default value. To change this, click on the "Financial Year" dropdown, select the relevant financial year and then click on "Save".
Importing employee opening balances is beneficial for a business that has transitioned to this payroll system mid financial year because:
- the figures are then incorporated into the employee's YTD earnings as displayed on their pay slip (therefore showing accurate YTD earnings);
- the earnings are then displayed when generating payroll reports for the financial year period.
Additionally, employee leave balances can be imported from this page, as part of the opening balances import. This will ensure that:
- leave balances are then correctly recorded on an employee's pay slip and displayed in the employee's portal (if the leave category setting is configured to be displayed as such);
- leave balances are recorded against the employee so that managers have the required information when managing leave requests;
- leave balances are recorded against the employee so that payroll has the required information when processing leave in the pay run.
Lastly, historic gross earnings can be imported from this page. The purpose of historic gross earnings is for the system to accurately calculate average wage earnings for an employee when they take leave. This involves importing 52 weeks of payroll data so that in circumstances where an employee takes leave in week 5 of the business using this payroll system but has been employed for 2 years, this payroll system will have the historic payroll earnings to correctly calculate the leave payment.
Obviously, if your business is brand new and has only paid the new employees in this payroll system (as opposed to any other), then historic gross earnings are not required.
Lastly you will notice an option to clear the opening balances / historic gross earnings you have entered for the employee:
This works on a 'per tab' basis. If you choose to clear the data within that particular tab keep in mind the relevant reports will be updated. This feature is especially helpful if you have a high level of data entered.
Difference between Opening Balances and Historic Gross Earnings
Opening balances are used for generating YTD payroll reporting (not IRD reports), displaying YTD payroll data on employee pay slips and importing leave balances. Any data contained in this import will not be used when determining average wage earnings for employee leave.
Historic gross earnings are used for the sole purpose of calculating average wage earnings when an employee takes and is paid for annual holidays.
How to access Opening Balances and Historic Gross Earnings
You will notice on the top right hand side of this page, there is an "Import" and "Export" option. When you clicking on any of these, select the relevant file you want from the dropdown list and follow the prompts.
Employee Opening Balances
To configure the opening balances for a specific employee, open up the employee file and then go to their Opening Balances page. Further instructions on this can be found here.